The EUR/USD pair is seen trading around a flat line near 1.12 handle post-China open and remains slightly offered as the USD selling paused in Asia.
EUR/USD rejected at the key resistance near 1.1240
Currently, EUR/USD trades -0.10% lower at 1.1197, recovering from fresh session lows of 1.1191 reached last hours. The bulls took a breather this Friday, with the major correcting the heavy gains seen over two consecutive sessions after the extensive USD sell-off, triggered by Fed’s Dudley’s word of caution and the recent poor run of US fundamentals.
While the common currency was also bolstered by ECB Draghi’s pledge to fight low inflation, in his speech in Germany on Thursday. EUR/UD gained nearly 350 pips over the last two trading sessions, reaching the highest levels since late-Oct at 1.1239.
In the day ahead, the risk remains to the upside for the main currency pair as markets expect sharp drop in jobs additions in the US economy last month, which will weigh on the Fed’s rate hike prospects. The US economy is forecast to have added around 189,000 jobs last month, sharply lower from 292,000 jobs added in December.
EUR/USD Technical Levels
In terms of technicals, the pair finds the immediate resistance is seen at 1.1239/50 (Feb 4 High/ psychological levels). A break beyond the last, doors will open for a test of 1.1270/80 (daily R1/ Oct 2015 levels). On the flip side, the immediate support is placed at 1.1169 (daily pivot) below which at 1.1088/62 (1h 50-SMA/ 5-DMA) could be tested.
(Market News Provided by FXstreet)